What to Know About the New Caps on Federal Student Loans
Student Loan Refinancing
Recent changes to federal student loan limits could significantly impact students, graduates, and borrowers.
Students looking to obtain advanced and graduate degrees will now have to navigate new federal borrowing limits. As a result:
- More students will be forced to find private loans.
- Students who may have previously relied on federal student loans may not have access to enough private credit to fund the remainder of their program.
- Some students may need to abandon the idea of a graduate or professional degree altogether.
Student Loan Refinancing Could Save You Thousands
Choose from a range of refinancing options and receive a special rate discount. Medical resident and fellow programs are available.
New Caps
Federal borrowing limits for most graduate students will now be capped at $20,500 a year. For certain programs, especially for those in health-related fields, that is often not enough to cover the cost.1
Federal borrowing limits for “professional” degrees—including 11 specific fields such as law, medicine, and dentistry2—are capped at $50,000 per year.
Expected Impact
As these loan caps discourage more students from pursuing graduate or advanced degrees, entire fields will be impacted, such as nursing. 4 In the U.S., there is already a growing need for nurses, and that is expected to increase as the population ages. This issue is only expected to intensify with the new borrowing limits.
Not only will the new limits have an impact on the workforce, but also on how students will be able to pay back their loans. With the new borrowing limits comes a complete restructuring of federal repayment programs. With Income-Contingent Repayment (I.C.R.) and Pay-As-You-Earn (PAYE) plans scheduled to be discontinued in 2028, struggling borrowers will have fewer options than ever to make monthly payments manageable.
Refinancing Options
Despite potential savings, only 10% of eligible borrowers refinance their student loans.5 When considering whether to refinance, borrowers need to evaluate the impact of becoming ineligible for federal benefits such as income-based repayment plans. These repayment options are expected to be discontinued, and it remains to be seen what federal assistance will look like, so it’s possible Student Loan Refinancing will become an increasingly popular option.
As more students are forced to take out both federal and private loans, borrowers can benefit by combining the two into one simple payment, which can result in a lower interest rate. Borrowers can then lower their monthly payment or pay off their debt faster—or both!
Checking your rate won’t hurt your credit score, so see if Student Loan Refinancing is right for you.
1 What the New Loan Caps Will Mean for Grad Students This Fall. The New York Times. www.nytimes.com/2026/04/15/upshot/student-debt-graduate-school.html, April 15, 2026.
2One Big Beautiful Bill Act – Important Definitions. Federal Student Aid. studentaid.gov/announcements-events/big-updates/definitions#professional-students, Last updated April 15, 2026.
3 Average Cost of Medical School. Education Data Initiative. educationdata.org/average-cost-of-medical-school, September 9, 2025.
4 New federal loan limits will worsen America’s nursing shortage and leave patients waiting longer for care. The Conversation. theconversation.com/new-federal-loan-limits-will-worsen-americas-nursing-shortage-and-leave-patients-waiting-longer-for-care-271807, January 7, 2026.
5 Only 10% of eligible borrowers refinance student loans despite potential savings. What’s stopping them? Earnest. www.earnest.com/blog/why-borrowers-dont-refinance-student-loans, March 30, 2026.
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